The Reserve Bank of Australia decided today to raise interest rates by 25 basis points to 4.25% meeting market forecasts, as the policy makers want to move borrowing costs to normal levels, especially after clear signs of recovery witnessed in the Australian economy.

However, the RBA said the global economy is growing at the current stage, and growth in Asian economies is getting stronger, while the performance of financial markets is getting better. The bank ensured that unemployment in Australia peaked less than forecasted.